With a knockout concept, 12RND Fitness delivers a serious uppercut to the fitness franchise industry
Australia’s fastest growing fitness franchise is punching market saturation concerns right in the breadbasket. While industry analysts point to flagging consumer interest in full-service gyms and the dominance of big box and 24/7 clubs offering cut rate pricing as indicators of an oncoming slowdown in the sector, 12RND Fitness demonstrates a different story.
Since the opening of their first franchise in 2016, 12RND has established 100 territories, making it the second largest boxing brand of all time, and by far the fastest growing. High impact interval training workouts designed by professional athletes and trainers put members through a series of three-minute rounds of boxing and strength training for a full body workout completed in just 45 minutes.
The approach is a championship winner for the Brisbane-based operation, which is in the midst of an ambitious expansion plan. “We built a product that allows every member access to coaches, training styles, and data that’s only been available to elite athletes,” company COO Jonah Hales said. Even multiple boxing titleholder Danny “the Green Machine” Green is in on the action and involved with the brand on multiple levels.
Rather than approaching exercise just for fitness, 12RND takes a different tack. “You can walk in fresh, not knowing anything about boxing and you can get to the basics,” Hales pointed out. “If you look at professional boxers, they start as young kids, and they’ll tell you that even as they’re finishing their careers they’re still learning. It’s a physical skill that people can get really excited about, and they get to see a clear progression from the start. That’s really engaging, especially if you’ve had an interest in sports or fitness all your life, you can train at 12RND, where you can genuinely learn skills. Seeing progress in not only your fitness but also your boxing skills as you keep getting better and better has you coming back for more.”
A demographic comparison of 12RND franchisees and members, composed of 28- to 45-year-olds of every gender and background, found great commonality. Said Hales, “They value time, they value the camaraderie they get in the club, and a tough workout that gets results.”
For Franchisees, Simplicity and Structure is a Winning Combo
Creating a seamless experience for franchisees is at the centre of 12RND’s strategy. “We’ve created something that's incredibly convenient for the customer and is a very simple to execute business for the franchisees,” Hales explained. “When we look at the product, boxing and functional strength training have global appeal, so we have designed systems that can be replicated anywhere using technology that’s growth-oriented and that allows owners to scale to operational efficiency.”
Without the cost of expensive and repair-prone treadmills, and other stationary fitness equipment found in typical gyms, 12RND’s capital requirements are significantly lower. “Because of our small footprint, functional strength equipment, and low capital requirements, clubs can generate a substantial income whilst being run with a small team,” Hales said.
Franchisees are given a high degree of support, which begins with the selection of territories and sites in prime locations to suit their demographic. “Site selection is a really important piece. This kind of business benefits from high levels of accessibility and visibility, a site easy for the locals to access. We want our franchisees to be in business for a long time, as longevity is important to us,” he added.
Before a new club opens its doors, 12RND runs a robustly structured marketing and sales campaign to reach as many new members as they can. Once open, the company’s business ecosystems support club owners with management, branding, marketing, product support, and benchmarking.
Franchisees are immediately assigned a franchise development manager that works hand-in-glove to provide guidelines, monitor membership and revenue targets, and keep an eye on a host of KPIs and other metrics.
“We give all the resources needed to set up the business and easily execute the strategy so they can focus on the really important things in our market, such as building good relationships and getting great results for the members,” Hales stressed. “Our focus has always been on having an instant product feedback loop with members, franchisees, and staff members, which allows for continuous improvement of our member offerings.
“Once people experience the product, they can see it’s a great workout with some really key differentiators which allow it to stand out in the market. This alleviates initial concerns around ‘why 12RND’ and how does it compete, as those elements become obvious.”
That concept experience Hales refers to is catching fire; in addition to their Australian territories, the 12 Round Group is currently setting up shop in New Zealand, Singapore, and the United Kingdom. Club openings will take place over the next few months, with expansion into the US planned for later in 2019. That means Hales will have his hands full for quite a while. “Our target by the end of next year is to be the biggest boxing provider in the world, which we are on track to achieve,” he reported.